Privatisation Commission Considers Air Niugini Sale Options

Papua New Guinea's Privatisation Commission is reviewing its options for the partial sale of Air Niugini to a trade-based buyer after receiving a number of indicative bids for the cornerstone shareholding.

Mr Ben Micah, the chairman of the Commission, said today that the written offers lodged on March 20 were being full assessed to determine whether they complied with the PNG Government's core objectives for the privatisation of the national carrier.

He emphasised that the Commission would need to be satisfied that substantial benefits from the sale would accrue to the state, the PNG public and the airline's employees.

"This is foremost in our minds as we consider the offers that are currently on the table. The Commission has a duty and responsibility to deliver an acceptable outcome through the privatisation which will establish firm foundations for the airline's future.

"Anything less than that would not be in keeping with the stated objectives of the Prime Minister Sir Mekere Morauta and the PNG Government in pursuing its rolling program of reforms to our state-owned enterprises."

Members of the Privatisation Commission met in Port Moresby earlier today to discuss the indicative bids which had been filed for a substantial shareholding of up to 49% in Air Niugini. The Commission is not disclosing the number of offers or the identities of the parties involved for confidentiality reasons.

Mr Micah said that the offers would be properly evaluated before any decision was made on the next step in the sale process. "It is pertinent to indicate at this stage that a number of factors need to be considered, including the overall acceptability of the offers within the terms laid down by the Government and recent market developments," he said.

"I should reiterate that it is the Government's intention that the privatisation should enhance the value of the airline, improve its operating practices and efficiencies, and provide greater security for employees. Air Niugini is an extremely valuable asset which has significant future prospects."

In February, expressions of interest were received from seven groups. The timetable for the lodging of bids was then extended by two weeks to allow these groups more time to consider the sale conditions fixed by the Government and major changes to the aviation regulatory system in PNG.